Large medical malpractice jury awards rare in Kentucky Bill would allow a $250,000 limit in certain cases

Reprinted from Louisville Courier-Journal 

By ANDREW WOLFSON
awolfson@courier-journal.com
The Courier-Journal

Kentucky juries seldom find doctors and hospitals negligent in court cases, and when they do, they don't often award large amounts for pain and suffering or punitive damages, a survey of jury verdicts shows.

According to the survey data — collected by the Kentucky Trial Court Review, a legal newsletter, and analyzed by The Courier-Journal — health-care providers won three-fourths of the 357 medical cases tried in the state over the past six years.

Among the 89 they lost, 37 resulted in damages for pain and suffering, or punitive damages, exceeding $250,000.

Law professors and trial attorneys said the data show that jury verdicts for pain and suffering, loss of companionship and punitive damages — so-called non-economic damages — aren't responsible for the spike in medical malpractice premiums that Gov. Ernie Fletcher and the Kentucky Medical Association said are forcing doctors to leave the state.

And they contend it shows there is no need for a constitutional amendment that would allow the General Assembly to limit such jury awards to $250,000. Kentucky's Senate has approved a bill putting such an amendment on the ballot; the bill is pending in a House committee.

"What these numbers show is that juries are already doing the job of holding damages down — and that it is hard to see a pressing need for a cap," said Professor Ronald Eades of the University of Louisville Brandeis School of Law. "Million-dollar verdicts are reserved for the most horrible injuries."

According to the Kentucky Trial Court Review numbers, a $250,000 cap would have affected about six cases a year in the state over the last six years.

But Fletcher said in a statement that he remains committed to caps on non-economic damages because states that have them have seen premiums rise more slowly than in states without them. States with $250,000 caps include California, Minnesota and Montana.

"Affordable, available healthcare in our state is in jeopardy, and Kentucky needs real medical malpractice reform to resolve this growing crisis," Fletcher said.

The Kentucky Medical Association said because plaintiffs lost 75 percent of the time it shows that they and their lawyers "are just rolling the dice, searching for another chance to hit the jackpot."

Association spokesman Marty White said limits on non-economic and punitive damages "would put a damper on the filing of frivolous lawsuits in pursuit of the big payoff."

University of Kentucky law professor Richard Ausness noted that 90percent of negligence cases are settled rather than tried, and that a cap on non-economic damages would hold down the cost of settlements because it would reduce the "downside risk'' to the defendants and their insurers. The proposed law wouldn't directly affect settlements.

Senate Bill 1, which would put the constitutional amendment on the ballot, is supported by the Kentucky Chamber of Commerce, the Kentucky Hospital Association, the Kentucky Medical Association and the governor, who is also a physician.

It is opposed by the Kentucky Academy of Trial Attorneys and Kentucky Watch, which describes itself as a non-partisan advocacy group working to improve consumer and insurance protections for Kentucky families.

Settlements higher  for major mistakes

The Kentucky Trial Court Review claims to record every civil-jury verdict in the state. The $150-a-year monthly publication is sold to insurance companies, hospitals and trial lawyers for plaintiffs and defendants. It describes itself as nonpartisan.

The Courier-Journal's analysis of verdicts compiled by the Court Review for the years 1998-2003 found that the average return for pain and suffering, loss of consortium and punitive damages was $180,289.

The newspaper found that a $250,000 cap would have saved the insurance industry about $8.6million a year in jury verdict damages, or about $750 per licensed Kentucky doctor. Juries returned punitive awards exceeding the proposed minimum cap only six times in the past six years.

The Kentucky Trial Court Review's examination of the verdicts in which damages exceeded the cap found that virtually every one involved "a grave or very serious injury."

Twenty plaintiffs were left either "dead, dying of cancer, brain damaged or paralyzed," the publication found. One infant lost a finger, another plaintiff an eye, a third a lung and a fourth his penis, all because of what juries found were errors by doctors, hospitals and nursing homes.

In interviews, lawyers for plaintiffs who won the largest awards defended them and said a $250,000 ceiling on non-economic damages would have been unfair to their clients.

Plaintiff Bill Rogers, who won a $1.9million pain-and-suffering award from a federal court jury in Bowling Green four years ago, after testimony that his penis had to be amputated when a leg infection was treated with the wrong antibiotics and spread, said: "If anything my verdict was not enough for what they have done to me.''

His lawyer noted the foreman of the jury was a nurse and that another juror was a urologist's wife.

Attorney Rhoda Faller said economic damages alone never could have adequately compensated the two children of Denora Jackson, a stay-at-home mom who died when Hardin County Hospital and an emergency room doctor failed to diagnose her entopic pregnancy. Each child was awarded $1million in damages in 1999 for the loss of their mother's companionship.

If the verdict was limited to economic damages — for their mother's loss of future earnings — the children would have recovered much less, because future earnings are projected based on current pay, and Jackson made only about $2,000 a year, Faller said.

But in another case, Lexington lawyer Clayton Robinson said the $4million for pain and suffering returned last May against an internist and Robinson's client, Sowder Nursing Home in Mount Vernon, was "a good illustration of the problem that the cap would solve."

A Rockcastle Circuit Court jury found that Roberta Powers was slowly poisoned to death because her doctor failed to monitor the level of lithium she had prescribed to treat Powers' mental illness.

Robinson said the jury failed to consider the myriad other medical problems that caused Powers' suffering and that the award — $148,000 a day (for the number of days during which the poisoning took place) by his calculation — was excessive. The case was later settled for less and was kept confidential.

At center of issue are  non-economic costs

The legislation passed by the Kentucky Senate on Jan. 15 wouldn't set a cap; instead it would allow voters to consider a constitutional amendment authorizing the General Assembly to set a cap of no less than $250,000 on punitive and non-economic damages. Economic damages for medical expenses and lost earnings would not be limited.

The amendment would also allow the legislature to adjust the statute of limitations and create a mandatory alternate dispute resolution system that might include a panel of experts to review a claim before trial.

Senate Bill 1 has been referred to the House Elections and Constitutional Amendments Committee, whose chairman, Rep. Adrian Arnold, D-Mount Sterling, said he expects to hold a hearing on it soon. House Democrats are expected to introduce an alternative to it this week that will focus on tighter regulation of the insurance industry.

House Democratic Whip Joe Barrows said the report on jury verdicts "blows up the notion we have great big awards and a lot of frivolous lawsuits in Kentucky'' and shows that caps are a "false hope being held out to doctors for a magic cure."

He said the small number of large non-economic damage awards suggests that Kentucky doctors are paying higher premiums because of mistakes by doctors in other states and because of bad investments by insurance carriers. But the Kentucky Medical Association and other proponents of Senate Bill 1 argue that the jury-verdict survey only shows the immense cost of defending questionable cases.

Even if Kentucky juries don't have a history of returning large verdicts for non-economic damages, said the medical association's White, insurance companies must consider the potential for such unlimited awards in setting premiums.

A ceiling on such damages would allow insurance carriers to set lower malpractice premiums, based on those limits, said White and Princeton lawyer Serieta Jaggers, who is president of Kentucky Defense Counsel, an insurance-defense lawyer group. (Jaggers said she was not speaking for the organization.)

Citing its own surveys and other data, the Kentucky Medical Association contends that Kentucky lost 819 practicing doctors in the two years ending in December 2002 — in many cases because of rising insurance premiums.

But it couldn't say how many left for that reason and White said it did not have permission to release their names.

The Kentucky Board of Medical Licensure says that the number of licensed physicians with practice addresses in Kentucky declined by 19 from July 2000 to July 2002.

Federal reports offer conflicting opinions

The Congressional Budget Office, a nonpartisan research arm of Congress, said in a report last month that premiums for all physicians nationwide rose 15percent between 2000 and 2002 — nearly twice as fast as total health-care spending per person.

But the cause of those increases has been the subject of conflicting reports.

The budget office said the available evidence suggests that increases in the size of malpractice awards and lower investment incomes for insurance carriers have both played a major role.

Since insurance companies' investment yields have been lower for the past few years, the office said, premiums are used to make up the difference.

But the General Accounting Office, the investigative arm of Congress, said in a report last August that growth in malpractice premiums and claims payments has been slower in states that enacted laws that include caps on non-economic damages.

For example, between 2001 and 2002, average premiums for three physician specialties — general surgery, internal medicine, and obstetrics/gynecology — grew by about 10percent in states with caps on non-economic damages of $250,000, compared with about 29percent in states with limited reforms, the General Accounting Office said.

The office also said it couldn't determine if the caps made the difference or if they were caused by other factors, such as increased competition among insurers.

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